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3 Cancer Stocks to Watch in December

By Cory Renauer – Nov 7, 2018 at 9:16AM

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Shares of these biotechs could surge following presentations at an important medical conference.

The American Society of Hematology (ASH) begins its 60th annual meeting on Dec. 1, and this year's going to be one to remember. Acceleron Pharma Inc. (XLRN), bluebird bio (BLUE 10.77%), and Amgen Inc. (AMGN 1.12%) are all scheduled to present highly anticipated results from experimental cancer therapies that could be worth billions. Here's what investors need to watch out for.

Acceleron Pharma Inc.: Luspatercept

At this year's ASH meeting, Acceleron Pharma Inc. and its collaboration partner Celgene Corporation (CELG) are going to present results from two pivotal studies with an experimental therapy called luspatercept. The erythroid maturation agent is intended to boost red blood cell (RBC) production for patients with two rare diseases marked by RBC deficiency. 

Lab worker holding test tubes in front of their face.

Image source: Getty Images.

During the Medalist trial, 38% of patients with myelodysplastic syndromes (MDS) who received luspatercept achieved independence from regular blood transfusions for at least eight weeks compared with just 13% of those given a placebo. Investigators will also present results from the Believe study, which enrolled transfusion-dependent beta-thalassemia patients. After 12 weeks of treatment, 21% of patients given luspatercept reduced their reliance on transfusions by at least one-third compared with just 4.5% of those given a placebo. 

While there are gene therapies in development that can reduce transfusion dependence much better than luspatercept appears to, they generally involve manufacturing a new batch for each patient. Acceleron's candidate is a relatively simple injection that could win over a large portion of patients with MDS and beta-thalassemia that aren't ready for more complex treatments.

If detailed presentations expected at ASH suggest it's on the right path, Acceleron stock could surge. Celgene and Acceleron think they can drive sales of luspatercept up to $2 billion annually. While Celgene is paying for 100% of development costs, Acceleron is still eligible to receive a royalty percentage in the low-to-mid-20% range on future luspatercept sales.

Cancer patient speaking with physician.

Image source: Getty Images.

bluebird bio: bb21217

Last year, bluebird bio thrilled oncologists with early results for bb2121, one of several cell-based therapies making a difference for multiple myeloma patients who have run out of treatment options. In a group that had failed seven prior treatments, 56% of those given bb2121 achieved a complete remission.

Bluebird's follow-up candidate, bb21217, is supposed to be a more persistent version of bb2121. At a June 15, 2018 observation period, 6 out of 7 evaluable patients given a low dose of bb21217 showed initial responses. The ongoing study is supposed to enroll around 50 patients, and investigators will present updated results at ASH in December. 

Early results for bb21217 were a bit mixed. Although the new candidate appears as effective as its predecessor, it might be too effective. One patient with a particularly high tumor burden suffered a case of life-threatening brain damage. The patient recovered, and investigators will avoid placing similar patients in high-dose groups going forward. If updated results that bluebird presents at ASH convince the crowd that bb21217 is relatively safe and effective, this stock will climb. 

Prescription pills on top of money.

Image source: Getty Images.

Amgen Inc.: AMG 420

Training a patient's own immune cells to recognize and attack cancer is effective, but awfully complicated. Bluebird's candidate involves removing a patient's T cells, then training them to recognize BCMA, a protein often found on the surface of cancer cells. Amgen's AMG 420 is an off-the-shelf antibody that tries to perform a similar function by attaching to two targets instead of just one.

In an early stage clinical trial with 35 advanced-stage multiple myeloma patients, the top-line results were positive, but investors still aren't sure how they feel about this program. In AMG 420's favor, 5 of 6 patients treated with a dosage the company will probably use in further studies showed an objective response and three were in complete remission. On the other hand, it isn't exactly a simple solution. Since AMG 420 doesn't last long in the bloodstream, patients need to stay hooked up to an IV for four straight weeks during every six-week cycle.

Across dosage groups, 49% of those treated with AMG 420 reported a serious adverse event, although only a few actually required hospitalization. Investors will be looking for further signs that Amgen's bispecific antibody can make a difference for heavily pretreated patients when the company presents the results on Dec. 3 at ASH. If investigators can keep showing us that AMG 420 is relatively safe and highly effective, analysts could start raising expectations for several bispecific antibody programs Amgen has in various stages of development.

Multiple moving pieces 

While all three of these cancer stocks are worth watching in December, some will have more to show off than others. If you're going to do more than just watch, you had better know what you're getting into.

Acceleron's future hinges on luspatercept, but bluebird bio is made up of enough moving pieces that it can continue climbing even if bb21217 fails to impress. Amgen is one of the largest biotechnology companies on the planet, and its bispecific antibodies would add to an oncology franchise that already generates billions in sales each year.

Cory Renauer owns shares of Celgene. The Motley Fool owns shares of and recommends Bluebird Bio and Celgene. The Motley Fool recommends Amgen. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Amgen Inc. Stock Quote
Amgen Inc.
$233.02 (1.12%) $2.58
bluebird bio, Inc. Stock Quote
bluebird bio, Inc.
$6.79 (10.77%) $0.66
Acceleron Pharma Stock Quote
Acceleron Pharma
Celgene Corporation Stock Quote
Celgene Corporation

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